CHAINED CPI: As budget negotiations heat up, the public will probably be hearing a lot of talk about “correcting the measure of inflation” or “chaining the CPI.” (CPI is short for Consumer Price Index.) The Bureau of Labor Statistics created the Chained CPI in 2002 which many experts say is a better measure of the actual “cost of living.” The chained CPI assumes that as prices rise on one product, some portion of consumers will be willing to substitute less expensive alternatives for what they used to buy. For instance, if the price of butter goes up consumers may switch to less expensive margarine instead. That changes the product weightings used in the inflation calculation such that the chained CPI typically produces a lower inflation level. The CPI is used to adjust income thresholds for government assistance programs, phase-out levels for certain tax credits, the standard deduction you can take on your tax return each year, even the size of the tax brackets themselves.

GOLD: Up until last year, gold prices traded higher for 11 consecutive years. Investors typically buy it for two reasons: either to guard against uncertain economic times or to hedge against inflation. Gold peaked in September 2011, trading at more than $1,900 a troy ounce. Recently gold traded at $1,592.85 an ounce, only a few percentage points away from a 20% decline, a benchmark that’s generally defined as a bear market.

Source: CNNMoney, 3/12/2013

EMPLOYMENT: Initial jobless claims are at their lowest level in five years. Week after week jobless claims have been hovering at their lowest levels since early 2008. Jobless claims are considered a proxy for layoffs, and their recent lows coincide with other data indicating that layoffs at the start of 2013 were back at pre-crisis levels.

Source: CNNMoney, Annalyn Kurtz, 3/21/2013

SOLAR: One of the world’s largest manufacturers of solar panels, Suntech Power, which is traded on the New York Stock Exchange, has nearly run out of cash and is poised to be taken over partly or entirely by the municipal government’s holding company in its hometown, Wuxi, China. Declining prices for solar products and global trade spats have taken a toll on the decade-old company which was already heavily dependent on government support.

Source: CNNMoney, 3/21/2013 & the New York Times, 3/21/2013

HOME SALES: Sales of previously owned homes reached an annual rate of nearly 5 million in February, the strongest pace in more than three years. The report from the National Association of Realtors was the latest sign of a housing recovery that has become a major positive force for the economy. The median sales price was up nearly 12% from a year ago which may have prompted some more people to put their homes on the market as the supply of homes for sale rose for the first time since July.

TECH JOBS:The fastest growing city for tech jobs isn’t Silicon Valley, it’s New York City, with 8,829 IT job postings on tech job site Dice.com leading the pack followed closely by the Washington D.C. – Baltimore area thanks to its huge concentration of defense contractors and trailed by third-place Silicon Valley with 5,123 job postings. Burlington, Vermont; Rochester, Minnesota; or Corvallis, Oregon are also hot spots worth watching with more patents per million residents than the traditional tech hubs.

CONFIDENCE: The Conference Board Consumer Confidence Index, which had improved in February, declined in March. The index now stands at 59.7 (1985 = 100), down from 69.6 in February. Lynn Franco, Director of Economic Indicators at The Conference Board said, “Consumer Confidence fell in March following February’s uptick. There was a sharp decline in expectations and consumers were more pessimistic in their assessment of current conditions with the recent “sequester” creating uncertainty regarding the economic outlook.”